Jury still out on legal pot: Colorado governor

States around the U.S. should be cautious when considering the legalization of marijuana, the governor of one of the first states to allow recreational use of cannabis told CNBC on Friday.

"We don't know what the unintended consequences are," Colorado Gov. John Hickenlooper said in a "Squawk Box" interview at the World Economic Forum in Davos, Switzerland. "Can we keep it out of the hands of kids? All the top neuroscientists say this high-THC marijuana can diminish long-term memory in teenagers."

Hickenlooper, whose state became the first to allow regulated retail sales of cannabis for recreational use despite his opposition, said he believes the legal pot business needs additional government oversight.

“You don’t want to be the first person to do something like this,” he said. “There’s a whole regulatory environment by the [federal Bureau of Alcohol, Tobacco and Firearms] that really regulates alcohol. We’re starting from scratch and we don’t have a federal partner because [marijuana] is still illegal federally.”

The Democratic governor said he would reverse legal pot’s ballot box win if he could.

“If I could’ve waved a wand the day after the election, I would've reversed the election and said ‘this was a bad idea,’” he said.

He added that Colorado’s legal marijuana business model lends itself to corruption and fraud because it is a cash business. “We do have a credit union that’s trying to work its way through. It’s got approval of the state [and] we think it might get federal approval,” he said. “No one wants it to be a cash business.”

Hickenlooper also said there are some indications of pot smuggling across state lines, though not at a large scale. “The studies we've seen of the people in Colorado [show] the people who were smoking before it was legal are still doing it, and people that weren't smoking it still aren't.”